"Half-built sections of the road loom dramatically over the streets below, as if straining to reach the concrete supports on the other side."

LOLZ. I love the grudging admiration (?) from the Economist. Must be the English way I guez.

But being Indian (or jus living there long enough!) can also do THAT to u! So I will add some more of my own. Reduction in fiscal deficit especially without "asset stripping" is gr8. Economic growth (especially 8.6%!) is also nice and dandy. But the bigger question is does it change any of the "ground" realities (pun intended)?Nah didn't think so either. What is the point of having all the money if you can't get clean water or uninterrupted electricity and the quality of life sucks? Anyways hopin against hope hope as Ogden Nash would say. On further thoughts MAYBE NOT!

PL123 wrote: Jun 2nd 2010 8:48 GMT
First learn how to bullshit! Great!! That´s why we have a financial crisis. Thanks for the business school...

Hey no disputes from me on that. Jus want to add that the other people (non MBAs) "bought into it" as well and benefited while the party lasted! Newsflash: Everybody loves money! In any case, the idea is get into it when things are booming, make money and get out b4 u lose ur shirt. So wat's the next BIG THING anyways? Any BETS? My money would be on "green" tech, only problem is there's big oil money already sloshing around. Biotech looks promising as well, now that we have synthetic life and what not. If only we could put aside some of the "ethical issues"...

"Green energy or unclean energy just increases the entropy of the system."

It always increases even if u sit around doing nothing, no? Say hello to Second (or is it third?) law of thermo-dynamics!

"Ultimately atmosphere is going to evaporate one day, unless we tie our tubes or experiment with truth"

Not sure wat that means. But know that atmosphere being in vapor state is already "evaporated"!

Reg global warming it reminds me of baldheads (what else do u call them anal-ysts?) in CNBC yappin about PRC's economy when many of them don't even know how Michigan's economy works. I kid u not, railway engineers like Pachauri are "climate scientists" today. Michael Crichton while researching for his book probably knew much more than these guys do about "climate".

"In my opinion MBA' need to be taught some basic science."

Great idea, I am all ears provided it will give them competitive advantage and more importantly fetch more money. Otherwise who cares? Let's leave it to the physicists who are "passionate" about their work and don't care about much about money.

"While purposely constructed affordable home will create "project ghettos" like those in inner-city America. So far no country have managed this very well, and it is often the root cause of many of social problems."

"No one should gloat. When arrogance sets in, devolution is not far behind."

There is only a thin line between arrogance and confidence! Humility is overrated anyways. At many of the B-schools especially the good ones the first thing they teach is how to sell urself (metaphorically of course!). It is not enough u know, u gotta SHOW it and ACT like ya know.

This is a welcome sign and proves well beyond doubt that economy fundamentals are strong. This also proves that India is not just an export oriented country, and domestic consumption will drive GDP growth further.

But this is the beginning of a long road. If we have to contain malnutrition, reduce poverty, improve literacy, provide free healthcare to the needy and poor, supply food to poorest of poor and maintain social harmony, India needs to grow at 10% of GDP rate this decade.

India's fiscal control is in able hands, in governance. Markets should be deregulated, subsidies minimized in petroleum products, and inflow of funds to be controlled so that episodes Dubai & Greece can be avoided. With current fiscal control measures, India will bring fiscal deficit to 6% within 2 years.
Being an Indian, I have full belief that despite omnipresent corruption, red tape and inefficient bureaucracy, three things will get us going- 1) quality education as compared to western countries 2) Effective governance or E-Governance and 3) Entrepreneurial spirit of every Indian, searching for business and survival in bottom of the pyramid and making it a success.

India will be a success story in this decade, a blue eyed boy and world will be watching. And by 2020, with a sustained growth rate of 10%, it might as well over take British economy, and much more.

Are you aware that China sputtered along for the first two of those six decades, and took some giant steps backwards with Mao’s great leap forward? And that they started to open up their economy almost 20 years before India? Those 20 years explain most of the difference between the two countires.

During the cold war, China was trying to fend off the monster at its door step – the USSR. So, it cozied up to the US. India was trying to do the same. It was trying to fend off two monsters at its door step – China and Pakistan (and Pakistan’s master state, the US). So it cozied up to the USSR. But what does any of this have to do with their economic growth? There are plenty of countries who ‘placed their bets’ with the winner of the cold war that are in doldrums – Pakistan being the most obvious.

Welcome back! I see the “well-wishers” of India from the north of the border are starting to pour in.

I was wondering if you are aware of the villages in inner China along the yellow river where most people live in subsistence conditions, and where the river is mostly full of sewage and chemical effluents from China’s factories along its banks and the fish are mostly dead. What is your opinion on how to provide these people with safe drinking water. Surely, getting rid of the hindu caste system is not going to do it.

In looking at India's economy, you have to compare it to China's. They both started at the same point six decades ago. The key question is why is China so far ahead of India? Is it because they have a fundamentally better governing system? Or is it because they placed their bets with the winner of the cold war while India placed its bets with USSR? Or is it because China is geographically destined to be a superpower, as Robert Kaplan would say while is a lesses one? While India might have managed to escape global crisis, its long term prospects are not as bright as Chinas.

This article is ridiculous. There is not the slightest mention made of the gargantuan subsidies of India. In India, virtually everything a consumer or company can buy is subsidized by the federal or state governments. The most recent estimates put the level of subsidies in India as approximately 15 percent of the country's GDP. Water are electricity are subsidised to the extent that they are free. Food, fertilizers, fuel, everything is subsidized in India. In short, India is an entire nation of welfare bums.

How anyone could decribe an entire nation of welfare bums as a good thing is beyond rational comprehension. If anyone wants to see the real India, cut all 15 percent of the subsidies today, and watch what happens. In the meantime, there is no possible way to describe a nation living on subsidies as a nation with a bright economic or financial future. A nation living on subsidies is a fake country.

1. China v/s India - most of this comparison was initiated by Investment banks when they needed to convince their senior managers to start looking at foreign investments beyond Europe seriously. however, to be fair, China started the act earlier than India by 15 years, and in many senses is where India most likely will be in 10-12 years.

2. Coming from Telecom and IT H/W industry, one of the most common graphs I took to my (US based - sigh..) seniors was that in terms of desktop adoption India is 7 years behind China, in terms of mobile adoption India is barely two years behind China, and in terms of Notebook adoption, its approx 4 years behind China.

3. However, there is otherwise little to compare - China is almost all exports, India is most significantly domestic consumption first (exports are not serious), which is a far superior quality growth. Lot of infrastructure in China is government initiated, whereas, the term in India is "liberalization" (from government policies and hand-holding) So, its impact on ordinary people is a little delayed, but is certainly more sustainable.

4. Re the usual clamour on per-capita - before Iceland collapsed, it had apparently one of the higher per capita incomes - that truly does not mean so much to its unfortunate populace, as it divides a number into a meaningless another number to express a ratio. What is more critical is that is the GDP growth arising from internal investments? and will therefore, generate more employment, better education, and superior medical care? It appears to be doing so...

But, yes, by any standards, a far more mature way of handling economy than has been shown by many "advanced" economies.

India's economy is growing and can overtake many western nations?! What about per capita incomes will it also rise to western nations? There are still more than 500 million individuals in India who struggle for basic living in India. Where is all wealth created by the gargantuan growth? Still family owned companies control huge portion of wealth & economy and the Government does not have a clue how to efficiently manage the Revenues it earns from taxes>>>>

Being an Indian, my statement comes with lots of passion. When the entire world economy is shaky, the team lead by Dr. Manmohan Singh had hit the nail on its head. This government has done the right thing at a very bad time stopping a tailspin that the rest of the world is still recovering from. Please acknowledge the fact that being a developing state that has been exploited by foreign powers for decades, India is now able to stand on its own legs. And everyone is expecting it to run the day it is born. It’s insane. People here are complaining about lack of power and infrastructure. Let me tell you a story, two salesmen went to an island to do a feasibility study on the topic "Selling shoes". The island was inhabited by not so sophisticated people who did not know the concept of footwear. One salesman concluded that it is a god forsaken place for a footwear market since no one wears shoes and there is absolutely no potential market. However the other salesman looks at it as an enormous potential where the entire market has not been tapped.

I now draw the parallel to the 3G auction that the Indian government has initiated where it would be raising $15bn. This is tapping into the rich resources of a developing country. Each individual Indian would be contributing towards it under the corporate telecom banners. If you are reading this through your wi-fi enabled mobile or blackberry, you are already contributing towards this cause. This is just one resource the government has tapped into. There are so many other avenues. PSU's that have not yet been divested, Booming industry sectors like the BPO sector backed by the human capital that the country is providing, etc, etc. Look at these benchmarks. Average earnings of an Indian in the last 5 years as compared to 15-20 years back. FII’s inflow into the Indian stock market in the last 5 years. The number of MNC companies that have set shop in India. These are the resources that India has got to offer for growing its economy. Now look at the developed countries. What are the left to tap (Fed....ofcourse).

So..please watch your back before commenting about the rising tigers of Asia. We are happy to learn but don’t like to be showcased as a backward economy.

It's easy to find negatives in a negative situation, positives in a positive situation; but it's difficult to find positives in a negative and negatives in a positive situation. This article tries to balance the last two.
This article by Economist is bit biased, I would say, and possibly comes with a narrow mindset (probably colonialist), citing and challenging economic aspects of a fast developing nation, and questioning the methods with which Fiscal control and economy control are put in place in India. Same is the case when it comes to China. Western world has to accept that old gives way to new, and it's just a universal cycle that India and China are to take their rightful place in the world, as it was before colonialism; and "advanced" world has to come to terms to live with it.
We will see more such articles about India, as we see about China every other day. Perhaps "advanced" economies are coming to live with it.
Not so negative or positive article anyway, but I would expect Economist to mention a word or two about the British hell hole of fiscal debt/deficit, figures around it, and ways to come out of it to.

Its amusing. Some people almost seem angry with India's economic growth. Yes there are a lot of bums in India. But that only means that there is a lot of spare growth generating capacity, and therefore implies that, with better management, India should be growing even faster.

Of most importance here. Municipal government is of bewildering complexity in India, and I freely confess I don't understand it. I doubt anyone in India understands it. At bottom, there is no national standard, definition, or legislation decribing what a municipality is, what a municipality's powers are, and what a municipality's responsibilities are. All that legislation is written and passed by state governments, so the definition, powers and responsibilities of municipal governments in India vary wildly and drastically from state to state. Those definitions, powers and responsibilities would seem bizarre, if not zany in many states to Westerners. They are often nothing like what westerners would consider ordinary laws governing the abilities and duties of ordinary rural areas, villages, towns, or cities in an ordinary country.

Briefly, for so many reasons that the Byzantine complexity would take pages to describe, ownership, sale, and purchase of land and buildings in virtually any Indian city can be an exercise of infinite frustration and futility. In a large city, for instance, it is normal for at least 20 or 30 municipal governments in that area to control the records of land and building ownership, sales, and purchases. Building any kind of infrastructure, such as a road, a subway, power lines, sewers, etc, requires permissions, clearances and authorizations from every single one of those 20 or 30 municipal governments. The process, naturally, takes years and decades for the smallest civil improvement.

Trying to buy a building or a parcel of land is a descent into the bowels of Hell, with demons stabbing you from every side. Buying a farm in India is torture and torment enough. Inside any urban area is entering the land of the damned. The little municipal governments of nearly every city in India never agree on where their borders are in relation to their neighboring little municipalities, and they always disagree on who owns most buildings or lots of land, whether there is any owner recorded, whether it might be public land or not, and a myriad other possibilities. As a result, buying land and buildings in any Indian urban area usually means paying five or six little municipal governments or purported 'owners' for the privilege. Plus, of course, the yearly circus routine of paying property tax to five or six little municipalities as well. If you want special services, such as electricity lines or sewers to your land or building, well, good luck, and may all the gods pour blessings upon you.

Secondly, no other nation on Earth has so many subsidies for so many ordinary citizens for so much money as India does. No other country in the world comes anywhere close to paying all the money for everything their people buy. Fifteen percent of India's GDP last year was 174 Billion dollars. To compare the subsidies for everyone of India to the economy of any other nation is factually false and impossible. No other country in the world has such a completely communist economy as India.

Home412AD,
Which countries do not subsidies its own economy or people. England´s social welfare, America´s agriculture subsides are good examples. Do you think the poor countries can compete with American cheap frozen chicken legs and wheat? I would rather if I can, live on social welfare instead of work like a dog for the capitalist. :-)

@Shades of Grey
indeed, real estate is a mess. Any attempts to influence price essentially pits people already spent their life's saving on home against those cannot afford homes. While purposely constructed affordable home will create "project ghettos" like those in inner-city America. So far no country have managed this very well, and it is often the root cause of many of social problems.

It feels nice to read about INDIA's well balanced and fast recovery. All thanks to its GREAT GOVERNANCE, democracy and concern for the common man as it does not suppress any individual's ideas like others. INDIA's economic growth or slowdown is its own only.